Missouri is a state situated in the Midwestern United States with a population of over 6 million people. It is known for its natural beauty, affordable living, and diverse economy. In this article, we will dive deep into the cost of living in Missouri, including various factors that contribute to it, such as the cost of housing, groceries, healthcare, education, transportation, taxes, and more.

What is the Cost of Living Index and How is it Calculated?

The cost of living in Missouri is determined by the Cost of Living Index, which is calculated based on the cost of living in various cities across the state. The index measures the average cost of essential items, such as housing, groceries, healthcare, transportation, and more, and compares them to the national average. A score of 100 represents the national average, and a score above 100 means that the cost of living is higher than the national average, while a score below 100 means that it is lower. For example, Missouri has a Cost of Living score of 89.7, which is lower than the national average, making it an affordable place to live.

It is important to note that the Cost of Living Index is not a perfect measure of the actual cost of living in a particular area. It only takes into account the cost of essential items and does not factor in other expenses, such as entertainment, dining out, or clothing. Additionally, the index does not consider the quality of life in a particular area, such as crime rates, education, or job opportunities. Therefore, it is important to do additional research and consider all factors when deciding where to live.

Average Household Income in Missouri

To understand the cost of living in Missouri, it is essential to understand the average household income in the state. According to recent data, the median household income in Missouri is $54,478, which is slightly below the national average of $62,843. This means that although the cost of living in Missouri is lower than the national average, the average income in the state is also lower.

It is important to note that the average household income in Missouri varies greatly depending on the region. For example, the average household income in St. Louis is higher than the state average, while the average household income in rural areas may be significantly lower. Additionally, certain industries, such as healthcare and education, tend to have higher salaries in Missouri compared to other industries.

Housing Costs in Missouri: Renting vs. Owning

Housing costs are a significant factor in determining the cost of living. In Missouri, the median home value is $171,000, which is lower than the national average of $265,000. This means that housing is relatively affordable in the state, whether you choose to rent or own a home. The average cost of rent for a one-bedroom apartment in Missouri is $701 per month, while the average cost of rent for a two-bedroom apartment is $890 per month. Owning a home is also relatively affordable, with the average mortgage payment being $1,150 per month. However, it is worth noting that property taxes in Missouri are slightly higher than the national average, which can increase the overall cost of housing for homeowners.

Another factor to consider when deciding between renting and owning a home in Missouri is the length of time you plan to stay in the area. If you are only planning to live in Missouri for a short period of time, renting may be the more cost-effective option. This is because the upfront costs of buying a home, such as a down payment and closing costs, can be significant and may not be worth it if you are not planning to stay in the home for a long period of time.

On the other hand, if you plan to stay in Missouri for a longer period of time, owning a home may be a better investment. This is because over time, the value of your home may appreciate, meaning that you could potentially sell it for more than you bought it for. Additionally, owning a home allows you to build equity, which can be used to finance other expenses in the future, such as home renovations or college tuition for your children.

Also read: Cost of living in St Louis

Taxes in Missouri: What to Expect

When moving to Missouri, it is essential to understand the tax system in the state. Missouri has a state income tax rate ranging from 0% to 5.4%, depending on your income bracket. The state sales tax in Missouri is 4.23%, but local sales tax can increase it up to 10.3%. Property taxes in Missouri are higher than the national average, with an average effective property tax rate of 0.97%. However, Missouri does not tax Social Security benefits, which can be beneficial for retirees.

It is important to note that Missouri also has a use tax, which is a tax on items purchased outside of the state but used within Missouri. This tax is equivalent to the state sales tax rate of 4.23%. Additionally, Missouri has a tax credit program for low-income individuals and families called the Missouri Property Tax Credit. This credit can provide up to $1,100 in relief for those who qualify.

Another tax to be aware of in Missouri is the personal property tax. This tax is assessed on tangible personal property, such as vehicles, boats, and trailers. The rate varies by county and is based on the value of the property. It is important to register your personal property with the county assessor’s office to ensure you are paying the correct amount of tax.

Cost of Groceries and Utilities in Missouri

The cost of groceries and utilities is another factor in determining the cost of living in Missouri. The average cost of a gallon of milk in Missouri is $2.60, while a loaf of bread costs $2.16 on average. The average utility bill in the state is $135 per month, which includes electricity, gas, water, and other utility costs.

It is important to note that the cost of groceries and utilities can vary depending on the location within Missouri. For example, in urban areas such as St. Louis and Kansas City, the cost of living may be higher than in rural areas. Additionally, the cost of utilities may be higher in areas with extreme weather conditions, such as areas prone to tornadoes or flooding.

However, Missouri does offer some cost-saving measures for residents. The state has a sales tax exemption for groceries, which can help lower the cost of food for families. Additionally, there are programs available for low-income households to receive assistance with their utility bills, such as the Low-Income Home Energy Assistance Program (LIHEAP).

Transportation Costs in Missouri: Gas, Insurance, and Registration

Transportation costs can also impact the cost of living in Missouri. The average price of a gallon of gas in Missouri is $2.60, which is slightly lower than the national average. Car insurance in Missouri is also relatively affordable, with an average annual premium of $882. However, it is worth noting that vehicle registration fees in Missouri are higher than the national average and can cost up to $42.50 per year.

Healthcare Costs in Missouri: Insurance and Medical Expenses

Healthcare costs can also play a significant role in determining the cost of living in Missouri. The average cost of health insurance in Missouri is $472 per month, which is slightly below the national average. However, medical expenses, such as doctor visits and prescription drugs, can be slightly higher than the national average.

Education Costs in Missouri: Tuition and Fees for Colleges and Universities

Education costs are also an essential factor in determining the cost of living in Missouri, especially for families with children. The average cost of in-state tuition and fees for a public four-year university in Missouri is $9,464 per year, which is lower than the national average. Private four-year universities in Missouri are also relatively affordable, with an average cost of $26,292 per year.

Affordable Places to Live in Missouri for Different Budgets

If you are looking for an affordable place to live in Missouri, there are several options to consider, depending on your budget. For example, cities like Springfield and Columbia are known for their affordable housing and low cost of living. However, if you have a higher budget, cities like St. Louis and Kansas City offer a more urban lifestyle, with higher housing costs but more entertainment and job opportunities.

Comparison of Cost of Living in Different Cities and Regions of Missouri

The cost of living in Missouri can also vary depending on the city or region you choose to live in. For example, the cost of living in St. Louis is slightly higher than the national average, while the cost of living in Springfield is lower. Additionally, rural areas in Missouri tend to have lower housing costs but less access to jobs and entertainment.

Tips for Saving Money While Living in Missouri

There are several ways to save money while living in Missouri, such as shopping for groceries at discount stores, avoiding unnecessary purchases, and using public transportation. Additionally, taking advantage of free activities and events, such as hiking trails, museums, and festivals, can help reduce entertainment costs.

Future Trends in the Cost of Living in Missouri

The cost of living in Missouri is expected to remain relatively stable in the coming years, with modest increases in housing and healthcare costs. However, the impact of the COVID-19 pandemic on the economy and job market could impact the cost of living in the state in the short term.

How Does the Cost of Living in Missouri Compare to Other States?

When compared to other states, the cost of living in Missouri is lower than the national average. However, it is slightly higher than neighboring states like Arkansas and Iowa. This makes Missouri an attractive option for people looking for an affordable place to live with a diverse economy and various entertainment options.

Impact of COVID-19 on the Cost of Living in Missouri

The COVID-19 pandemic has impacted the cost of living in Missouri, as it has in many other areas of the country. The pandemic has resulted in job losses and economic instability, which can impact the affordability of living in the state. Additionally, healthcare costs may increase due to the pandemic’s impact on the healthcare system.

Conclusion

In conclusion, the cost of living in Missouri is relatively affordable, with lower housing costs, lower taxes than the national average, and a diverse economy. However, healthcare and education costs may be slightly higher than the national average. By understanding the various factors that contribute to the cost of living in Missouri, individuals can make informed decisions about where to live, work, and play in the state.